Credit Repair Services in the US Industry Market Research Report Now Available from IBISWorld

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Most industries in the United States went down with the ship during the recession, but the Credit Repair Services industry was not one of them. As consumers credit scores dropped in the face of late payments due to unemployment and reduced income, industry demand rose at a brisk pace. As the recovery got under way in 2010 and 2011, that growth moderated, but increasing revenue is still expected throughout the next five years. For these reasons, industry research firm IBISWorld has added a report on the Credit Repair Services industry to its growing industry report collection.

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Los Angeles, CA (PRWEB)May 24, 2012

The Credit Repair Services industry largely moves countercyclical to the business cycle; as such, the recession increased demand for credit repair services due to rising unemployment and falling disposable income. These factors, coupled with an increased debt load taken on by many consumers during the housing boom, caused many households to fall behind on payments. Consequently, says IBISWorld industry analyst Kevin Culbert, “The rising number of consumers having debt problems has increased the demand for credit repair services over the past five years.” In the five years to 2012, IBISWorld estimates that revenue for the industry will grow at an annualized rate of 3.9% to $9.8 billion, including growth of 1.9% in 2012.

Prior to the recession, the amount of consumer debt increased to a record high while the personal savings rate declined to a record low. Strong economic growth caused overly confident consumers to take on exorbitant amounts of debt. An increase in the average consumer's outstanding debt occurred largely because banks offered home loans to a larger proportion of the population. Ultimately, these factors set the ball in motion for the industry when the housing bubble burst. “Consumers that were overextended on credit lines were particularly vulnerable when house prices began to fall and the unemployment rate started to rise,” says Culbert. Ultimately, more consumers have turned to credit repair services over the past five years for a variety of services, including credit repair consultations and credit reestablishment. Rising demand has caused more firms to enter the Credit Repair Services industry, which remains highly fragmented. In the five years to 2012, IBISWorld estimates that the number of industry operators has increased 3.7% on average annually to 127,548, many of which are non-employers. No single firm accounts for more than 5.0% of industry revenue.

IBISWorld estimates that revenue for the Credit Repair Services industry will grow over the five years to 2017. During that time, the industry is expected to experience more regulation as the Federal Trade Commission (FTC) cracks down on predatory service providers. Such crackdowns are not new, however. In 2008, the FTC teamed with 24 state agencies to root out a variety of offenses, including deceptive practices and charging advanced fees for services, both of which violate the Credit Repair Organizations Act. These crackdowns are expected to increase over the next five years and weigh on industry margins. For more information, visit IBISWorld’s Credit Repair Services report in the US industry page.

This industry identifies errors in credit reporting and disputes inaccurate information with the appropriate organizations to improve credit ratings. These services are typically undertaken on behalf of a client who has known credit problems, such as a recent bankruptcy. This industry does not include non-profit firms that offer credit-counseling services.

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.